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More Legal Trouble for Microsoft
by Chris Stamper

3:00 a.m.  28.Jun.99.PDT
SEATTLE -- Just as Microsoft's antitrust trial in Washington is winding down, another antitrust trial against the world's biggest software company will get under way in Salt Lake City next week.

On Tuesday, Caldera, a small vendor of PC operating systems, will accuse Microsoft of breaking antitrust law by illegally tying MS-DOS and Windows and refusing to give a beta to a competitor.


Read ongoing US v. Microsoft coverage

When hearings resume in the antitrust case after a two-week recess, Caldera will try to shoot down Microsoft's motions for summary judgment on these two claims. Caldera will argue before US District Judge Dee Benson that Microsoft broke the law in order to maintain its dominance of the operating systems market and run off DR-DOS.

Caldera sells Linux software and DR-DOS, an alternative to Microsoft's MS-DOS. MS-DOS was the predominant operating system for personal computers in the late 1980s and early 1990s. Caldera bought DR-DOS, once a serious competitor to MS-DOS, from Novell in 1996, then filed an antitrust suit just days later. The new owners claim Microsoft blacklisted DR-DOS' developers from receiving a beta of Windows 3.1 to ensure the two products were incompatible.

"They would not give Novell copies of the beta even though they gave them to other people they considered competitors," said Caldera spokesman Lyle Ball.

Court filings call this an "unlawful refusal to deal and denial of access to essential facilities."

They also cite a memo from Microsoft's public relations firm, Waggener Edstrom, as Windows 3.1 was being prepared. "PR is going to have limited ability to help you if Microsoft is deliberately and selectively keeping DRI [Digital Research Inc., which sold DR-DOS to Novell] from participating in the beta program," it read. "That is, if you are making a special case of them that is not consistent with the way that the beta program is being administered for the rest of the industry."

Microsoft spokesman Adam Sohn said federal law does not require companies to share the details of its unreleased products with direct competitors. Besides, Novell found its own bootleg copy anyway. "This is part of healthy competition," he said. "The antitrust law supports it."

Caldera also charges MS-Dos and Windows 3.1 are separate products and there is no technical reason to bundle them as Windows 95. In order to fool people that the two products are separate, the MS-DOS start-up sequence is behind the familiar splash screen with blue clouds and logos, Caldera claims.

"Windows 95 is nothing more than the MS-DOS upgrade and the Windows 3 unnecessarily tied together predominantly for anticompetitive purposes," said Ball.

Sohn said the charge is preposterous and Windows 95 is clearly greater than the sum of its parts. He said antitrust law supports integration of two products as long as it benefits consumers. This allegation is "one of the wildest" to come from Caldera, he said. "They're really grasping at straws on this one."

To supports its claim, Caldera's court filings state that Windows developer and product manager Phil Barrett testified, "Windows 95 [is] DOS and Windows stuck together with baling wire and bubble gum."

Microsoft's lawyers claim Caldera wants up to US$1.6 billion in damages, which is significantly more than DR-DOS' $400,000 purchase price. The final hearing in Benson's court is scheduled for 7 July.

In a previous session, Caldera claimed Microsoft rigged a Windows beta to give DR-DOS users a phony error message, sent out premature product announcements, and offered exclusive licenses and volume discounts to manufacturers in a campaign to kill DR-DOS. Ball said his company's case is completely different from the Justice Department's antitrust suit over Internet browsers.

"Our case is about how they illegally maintained their core business, [the] operating system monopoly, not how they may have used that assumed monopoly to influence other niches," he said.

No ruling has yet been made on either party's motions and a jury trial is set to begin on 17 January 2000 in US Federal District Court in Salt Lake City.

Related Wired Links:

Caldera: Throw Out MS Motion
4.Jun.99

New Hearing in Caldera v. MS
27.May.99

Another Salvo Against Microsoft
25.May.99

Caldera 2, Microsoft 0
21.May.99

Caldera: MS Cheated in DOS War
4.May.99

Caldera Obtains Win 95 Code
29.Jul.98



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